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Central Excise - Case Laws
Showing 61 to 80 of 225 Records
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2013 (8) TMI 686
Eligiblity of Cenvat credit in respect of shapes and sections, Joists, Channels, MS Girders, Tropozodial Sheets, Channels, H.R. Coils etc - Items were used by them in the factory for fabrication of various components of the sugar mill machinery and also the pipeline and only some quantity had been used in making of supporting structures – Held that:- To the extent, the use of the steel is for fabrication of sugar mill machinery or its parts or pipes and tubes, the Cenvat credit would be admissible. The Cenvat credit would be inadmissible only in respect of that quantity of steel which has been used for supporting structures - Matters are remanded to the original Adjudicating Authority for denovo decision. The original Adjudicating Authority in course of denovo decision must examine the evidence produced by the appellant in support of their claim that major quantity of the steel items have been used in fabrication of pipes and tubes and equipment and parts of the sugar mill machinery.
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2013 (8) TMI 685
Determination of weight - Benefit of exemption notification No.6/2001-CE dt.1.3.01 - first clearance upto 3500 MT of paper and paper board or article made therefrom - whether the weight of wrapper (packing paper and paper board) shall be taken into account to determine the quantity cleared in a financial year - Held that:- appellants have not disclosed gross weight and net weight in respect of each packet of the paper in any of the documents occasioning clearance during material period. Normally when a container contains contents, the gross weight and net weight are exhibited on the container. In the present reference weight of contents and container was not exhibited conspicuously. Weights and Measures Act has adopted the rationale of gross weight and net weight for consumer protection and declaration of MRP. This is to save the consumer from exploitation.
It is strange how Ld. Commissioner (A) ignored the fact that wrappers cleared were excisable goods and material for the purpose of grant of notification. But he based his decision on irrelevant considerations. If the weight of wrapper in question was also material that needed thorough scrutiny. Ignoring such aspect learned Commissioner buried interest of Revenue.
When the appellants did not challenge manufacture of the wrapper by them and those were cleared and were excisable and to be accounted for, appellant should have come out with clean hands to prove the weight of wrappers cleared. But they have chosen a way to avoid such disclosure. - Matter remanded for re-adjudication.
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2013 (8) TMI 684
Benefit of Notification No. 6/02-CE - Refund of duty paid at the time of clearance of the motor vehicle - Authorities denied the refund claim - Held that:- extended period of three months, as mentioned in the notification, is for registration of the vehicle and not merely for submission of the registration certificate - Following decision of Tata Motors Ltd. vs. CCE, Lucknow [2011 (5) TMI 233 - CESTAT, NEW DELHI] - Decided in favour of assessee.
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2013 (8) TMI 683
Rule 6(3) of the Cenvat Credit Rules read with Rule 57CC of the earlier Rules - Applicant is engaged in the manufacture of sugar, availing CENVAT credit benefit - During the process of manufacture of sugar, a by-product "bagasse" (a non-dutiable product) emerges, which was used in the generation of electricity – Held that:- Relying upon the decision in the case of India Potash Ltd. Vs. Commissioner of Central Excise, Allahabad reported in [ 2012 (12) TMI 347 - CESTAT, NEW DELHI] held that the assessee is not required to pay an amount equal to 8% on sale value of bagasse under Rule 6(3) of CENVAT Credit Rule, 2004 - Waiver of pre-deposit of dues allowed and recovery thereof stayed during the pendency of the appeal – Decided in favor of Assessee.
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2013 (8) TMI 682
Undervaluation of Goods - Rule 8 - clearance to another unit of the assessee - cost plus valuation - captive consumption - manufacturing of cement - Held that:- the provisions of Rule 8 of the Valuation Rules will not apply in a case where some part of the production is cleared to independent buyers.
The provisions of Rule 4 are in any case to be preferred over the provisions of Rule 8 not only for the reason that they occur first in the sequential order of the Valuation Rules but also for the reason that in a case where both the rules are applicable, the application of Rule 4 will lead to a determination of a value which will be more consistent and in accordance with the parent statutory provisions of Section 4 of the Central Excise Act, 1944. - Decided against the assessee.
Confirmation of Differential Duty - held that:- the valuation of Bulk cement needs to be valued on the basis of sale value to independent buyers, but differential duty cannot include the clearances effected by NCMU unit of the appellant, after repacking or sale as such of Bulk cement received from the appellant; as NCMU unit is doing so, after availing CENVAT Credit as such Bulk cement, as NCMU unit is not situated in the Bhavnagar Commissionerate.
Period of Limitation - Whether the Show Cause Notice which invoked the extended period of limitation was applicable for period beyond one year or not - Held that:- The assesses had every reason to believe that the board’s circular would be applicable to them and hence sought to value of the goods based upon the cost of production and as per provisions of Rule 8 of Central Excise Valuation Rules - the demand of duty prior to the period of one year from the date of issuance of Show Cause Notice dt. 09.11.2009 was hit by limitation and that portion of demand was liable to be set aside.
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2013 (8) TMI 681
Nature of Product - Whether cassia meal (husk and germ) of Cassia seeds can be considered as excisable at all – The cassia gum is exported. - Held that:- the appellants themselves treated this item as a cattle feed supplement/cattle feed and did not consider it as a waste. - The classification of the product was also held to be under the heading 2302 and the goods were excisable.
Whether cassia meal can be considered as a waste at all - Held that:- cassia meal was not a waste at all and was excisable, the obvious conclusion that emerges was that appellant was not eligible for exemption under notification No.23/03 which under sl.no.21 exempts waste from food industries arising from purchasing of indigenous raw material.
Whether the product is foodstuff - Held that:- the definition of hydrocolloids and use of their product, cassia gum product is basically used as a texturising agent, gelling agent to provide suspension and stabilisation of the end product and to improve end product appearance. Therefore it only improves the quality of food and can by no means by called as food itself.
Product Indigenous or Not - Whether the product can be considered to have been manufactured wholly of indigenous raw materials or not - Held that:- The manufacturing process explained and from the records what emerges is that the cassia meal gets segregated and separated and taken out of the product before further processing starts by using imported raw materials - it cannot be said that importer raw materials have been used in the manufacture of waste - The word goods was to be considered as waste from food industry which was what was exempted from payment of duty if the condition was fulfilled - it appears that what was intended was that for manufacture of waste, indigenous raw materials only should have been used.
Alternative claim for exemption under notification No.23/03 as waste of oil seeds - Held that:- There was no merit in the alternative claim made by the assesses - assesses own production literature and the details available on their website show that they had described cassia as a new hydrocolloids supplying to the group of galacto mannans like guar, thara and locoest bee gum (LBG) and they had never described it as an oil seed - the chemical examiner also had given a clear opinion that cassia meal was other than waste of oil seeds and during the cross examination of chemical examiner no question was raised on this issue with the chemical examiner.
Extended Period - Whether the extended period had been rightly invoked - Held that:- Extended period cannot be invoked – it would be appropriate that no penalty to be imposable on the appellants and therefore penalty imposed was set aside - Subsequent to audit report and investigation, from the records it emerges that appellants did make efforts to prove that their product was waste by getting technical opinion and getting a letter from the Development Commissioner - Relying upon NIRMA CHEMICAL WORKS Versus COLLECTOR OF CENTRAL EXCISE [1992 (9) TMI 196 - CEGAT, NEW DELHI] - It had to be observed that many technical experts had given them the opinion that the product was a waste - All the facts and circumstances would show that this would not be a fit case for invoking extended period.
Benefit of Cum Duty Price – Reduced Duty Demand – Interest - Confiscation of Goods - Held that:- There was nothing wrong with the view taken by the Commissioner - Demand duty was reduced and since goods were not available the same cannot be confiscated - relying upon COMMISSIONER OF CENTRAL EXCISE, DELHI Versus MARUTI UDYOG LTD. [2002 (2) TMI 101 - Supreme Court] - cum duty benefit cannot be allowed and in that case duty had been demanded on clandestine clearances by the EOU without payment of duty and without issue of invoices - goods were cleared by EOU without payment of duty under parallel invoices and clearances were made by fraudulently availing exemption - None of the circumstances exist in this case - Interest on the duty demanded within the normal period had to be upheld - the demand for duty was upheld to the extent of duty demanded within the normal period of limitation with interest as applicable - Decided against Revenue.
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2013 (8) TMI 680
Scrap chargeable to duty or not - scrap generated in the repair & maintenance workshop of the factory - The appellants sold the old and worn out parts of the machinery and also the scrap generated in the course of fabrication of parts of the machinery without payment of duty - The department was of the view that this scrap was chargeable to central excise duty - Held that:- The M.S. scrap and Iron scrap cannot be said to be a by-product of the final product - At the best, it was the by-product of the repairing process which uses welding electrodes, mild steel, cutting tools, M.S. Angles, M.S. Channels, M.S. Beams - The metal scrap and waste arise only when the assessee undertakes repairing and maintenance work of the capital goods and, therefore, do not arise regularly and continuously in the course of a manufacturing business of cement.
The scrap generated in the repair & maintenance workshop of the factory cannot be said to be the scrap generated in a manufacturing process or a byproduct of manufacturing process and hence the same was not excisable - M/s. Grasim Industries Ltd. Versus Union of India [2011 (10) TMI 2 - SUPREME COURT OF INDIA] - The issue of getting a new identity as M.S. Scrap and Iron Scrap as an end product due to manufacturing process does not arise for consideration - The repairing activity in any possible manner cannot be called as a part of manufacturing activity in relation to production of end product - Order set aside – Decided in favor of assesse.
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2013 (8) TMI 649
Production capacity based duty - Power to Review the Order - Whether after the Commissioner had determined the annual capacity of production the Commissioner could review his order when he was informed that fake certificates were issued and as such the earlier determination was based on false and fabricated invoice/certificates regarding the annual capacity of production - Held that:- The question was answered in negative - Assesse was available and has also filed his reply to the notice issued by the Excise Commissioner in which he had stated that his statement was recorded under duress thus his statement could not have been relied without his cross examination - apart from the statement there was no material before the Excise Commissioner to hold that the respondent has produced fake invoices - Statement was not recorded in the proceeding as such it could not be read as an evidence and there was no material for exercising the powers under Proviso to Section 11-A of the Act.
Material to Prove the Fraud - Whether there was any material before the Excise Commissioner to hold that earlier order was obtained by committing fraud - Held that:- Statement had not been recorded as a witness in the proceeding as such there was no admissible evidence on record to hold that fraud has been committed by the respondent - The Excise Commissioner had illegally treated the statement as an admission - According to the Excise Commissioner as Excise Officer was not a police officer as such the voluntary statement made before him was admissible and Section 25 of the Evidence Act will not apply.
CCE Versus Versus M/s Bajaj Auto Ltd. [2010 (11) TMI 7 - Supreme Court India] - Initial burden lies upon the Department to prove that fraud had been committed for invoking provision of Section 11-A Proviso, of the Central Excise Act, 1944 - Excise Commissioner had relied upon the statement recorded by Excise Officer during investigation held against his firm and found that as Deepak Gupta had admitted that he had issued invoices giving incorrect Annual Capacity of Production as such the respondent has secured the previous order by producing forged document as he found that statement of Deepak Gupta was admissible under Section 25 of the Evidence Act - Decided against Department.
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2013 (8) TMI 648
CENVAT credit - The assesse had taken Central Excise registration for manufacture of copper ingots, copper wire and insulated copper wire - they had availed huge amount of Cenvat credit - They had neither filed the Cenvat credit returns nor in the ER-1 they have given the invoice details – Held that:- Prima facie the department’s case against the appellant was on their strong footing and the evidence on record clearly indicates that the Cenvat credit had been availed by the assesse in a fraudulent manner without any invoices without actually receiving any goods and this action of the assesse would attract penalty u/s 15 (2) of Cenvat Credit Rules, 2004 readwith Section 11AC.
They had without manufacturing any goods passed on the bogus Cenvat credit by issuing bogus invoices to other manufacturers on the basis of which those manufacturers would have taken the Cenvat credit - no TR-6 challans in this regard had been produced and if this payment had been made by debiting the Cenvat credit amount, the same was meaningless, as all the evidence on record, prima facie, shows that the entire Cenvat credit had been availed by them in a fraudulent manner without receiving any goods and without any invoices - the assesse’s claim in their remark in the ER-1 return that amount was debited by them for payment of penalty imposed by CESTAT was false.
Waiver of Pre-deposit – Prima-facie the assesse was not able to make out the case in their favor - Penalty equal to the fraudulently taken Cenvat credit would be attracted under Rule 15 (2) of Cenvat Credit Rules, 2004 read with Section 11AC of Central Excise Act, 1944 – 2 crores were ordered to be submitted as pre-deposit – upon such submission rest of the duty to be waived till the disposal – Stay granted.
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2013 (8) TMI 647
Condonation of Delay Application – Held that:- the Senior Manager had followed up the proceedings before the lower authority and he was sick from 02.02.2012 to 01.03.2012 and appeal was filed on 07.03.2012 – The Senior Manager signed the documents before the lower authority and the Appellate Tribunal - Justified to condone the delay – Decided in favor of Assessee.
Stay Application – Waiver of Pre-deposit - Cenvat Credit on Outdoor Catering Service - Outdoor Catering Service used in canteen for employees – Relying upon the decision of the Hon'ble Bombay High Court in the case of Commissioner of Central Excise, Nagpur Vs Ultratech Cement Ltd. reported in 2010 (10) TMI 13 - BOMBAY HIGH COURT, credit of service tax paid on Outdoor Catering Service allowed as eligible for CENVAT credit – Demand waived – Stay allowed – Decided in favor of Assessee.
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2013 (8) TMI 646
Rectification of mistake in the order - Assessee over the period of 13 years did not take note of or considered whether there was a case on merit or not and was fighting the case on a technical ground that there was no recovery mechanism and there was never a whisper about merits. Even when the impugned order was passed the only submission made by the assessee was that the show-cause notice was time barred – Held that:- The issue on merit was never raised - This ground of merit is being raised only in the application for rectification of mistake. As regards proceedings for recovery for the year 2001, the matter is before us in the first round of litigation. But even in this case merit was never an issue. The issue was only limitation and whether there was a provision for recovery in the law or not - The assessee seems to be seeking rectification of mistakes committed by Original Authority, First Appellate Authority and by this Tribunal on six occasions - This cannot qualify as a mistake apparent from the records at all – Decided against the Assessee.
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2013 (8) TMI 645
Processing of Cotton Fabrics without the aid of power or steam - Benefit of Exemption Notification No. 111/87 - Whether the exemption Notification No. 111/87-CE would be available to assesse whose clearances for home consumption of the cotton fabrics processed without aid of power or steam in a financial year exceed 50 lakh Sq. mtr. - Revenue was of the view that the exemption would not be available to an assesse from day one – Held that:- The interpretation to the notification given by the Commissioner was incorrect and as such even if the clearances of the processed cotton fabric during a financial year exceed the threshold limit prescribed in the notification, it was only the clearances in excess of this limit which would attract duty, and crossing the threshold limit would not result in total denial of the exemption - There was no provision in the notification to the effect that the exemption would not be applicable if the aggregate quantity of clearances of processed fabrics for home consumption for one or more factories of the manufacturer during the financial year exceed the prescribed threshold limit.
Unaccounted Processing of Goods - Processing of cotton fabrics without accounted on the records - Held that:- There was no reason to disbelieve the records of the other contractors - the department's allegation that in addition to the quantity of 43,31,361 L. Mtrs. of fabrics as shown in Central Excise records of the appellant firm another quantity of 3,63,213.55 L. Mtrs of fabrics was also been processed and cleared - For determination of duty on the quantity of fabrics processed and cleared in excess, the matter would had to be remanded.
Goods Cleared Without Payment of Duty - Held that:- No duty was chargeable on fabrics - There was gain in the quantity due to elongation of the fabrics during stentering - Since the increase in the length of fabrics had taken place during stentering which was fully exempted process.
Limitation Period u/s 11A(1) - Held that:- The fabric was processed without aid of power or steam and clearance was not reflected in the Central Excise records and was cleared without payment of duty the same had to be treated as clandestine removal and accordingly the longer limitation period under proviso to section 11A (1) would be available to the department and for the same reason penalty under Rule 173Q(1)(d) of the Central Excise Rules, 1944 would be imposable on the appellant firm - There was nothing wrong in simultaneous imposition of penalty on the Appellant firm and its partner as the two penalties are under different rules and for different contraventions - Order set aside – Matter Remanded back for re-quantification of the duty demand and also for redetermination of the quantum of penalty on the appellant firm and on partners.
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2013 (8) TMI 614
Belated payment of duty - Restriction on utilizing CENVAT credit - Rule 8 of central excise rules - appellant submitted that the Department directed the appellant to pay the sum of ₹ 53,62,822/-, without affording any opportunity to the appellant as no show cause notice was issued and straight away a demand was served on the appellant. - Principles of Natural Justice - Assesse cited financial crises and did not remit the Central Excise Duty.
Held that:- The revenue shall issue a show cause notice to the assesse clearly indicating the defaulted amount together with interest and the appellant shall be entitled to submit their reply to the show cause notice and thereafter the respondents shall pass orders on merits and in accordance with law - Assesse should be put on some terms before the Department was directed to issue a show cause notice to the assesse - before the quantifying the total amount the department ought to have issued a show notice to the appellant clearly setting out the period of default, the amount payable, the interest payable on the said amount and afford an opportunity to the appellant.
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2013 (8) TMI 613
Refund Claim – Notification No.19/2004 - 100% EOU - Export of goods after clearance to DTA - The assesse had filed the application for refund on the ground that the product Sesame seeds were exempted in DTA and subsequently claim the refund on the ground that the goods cleared in DTA were ultimately exported - Held that:- The goods exported cannot be correlated with goods cleared in DTA - the duty paid on goods exported was not proved - the fundamental requirement of export of duty paid goods was not satisfied the rebate claim was not admissible to the assesse under Rule 18 of Central Excise Rules, 2002 read with Notification No. 19/2004 - J. Yashoda v. Shobha Rani [2007 (4) TMI 11 - SUPREME COURT OF INDIA ] - Non-preparation of statutory document and not following the basic procedure of export goods as discussed above, cannot be treated as just a minor/technical procedural lapse for the purpose of granting rebate of duty on the materials used in the manufacture of impugned exported goods – Order set aside.
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2013 (8) TMI 612
Proof of Export - incompatibility in description - Challenge to show cause notice though reply was filed - Bar of Limitation - Admission of writ petition - Held that:- The provisions of the Central Excise Act suggest that the time limit prescribed thereunder was absolute and unextendable by a court under Section 5 of the Limitation Act - it was the duty of the court to respect the legislative intent and that liberal interpretation contrary thereto ought not be granted – Following Commissioner of Customs & Central Excise Versus M/s Hongo India (P) Ltd. & Anr. [2009 (3) TMI 31 - SUPREME COURT] - by the time the revision petition under Section 35EE was filed not only the period of limitation prescribed therefor had expired but also the term of relaxation grantable had lapsed.
We are left unpersuaded by the petitioner’s plea for condonation of delay on the ground of its bona fide litigating before a wrong forum. The assertion of the respondents to the effect that in the other accompanying instances, the petitioner had rightly identified the forum, in the overall factual backdrop cannot also be lightly discarded.
However, the above rejection of the petitioner’s revision application under Section 35EE being only on the ground of limitation and not on merits, the arguments against merger thereof with the order of the Commissioner (Appeals), Jaipur has substance.
Proof of Export - Duty Demand u/s 11A - Interest u/s 11AB and Penalty - Assesse submitted the proof of export before the authority for acceptance under the provision of the Rules and the authority had accepted the same - authority withdrew the acceptance of the proof of export covering the consignments - Held that:- The action of the authorities on the ground of misdescription of the goods by the petitioner, on a cumulative consideration cannot be construed to be untenable - The relief claimed by the petitioner was statutory in nature and would be logically available to it on strict compliance of the prescriptions in connection therewith - The mere contingency that at some earlier point of time, the acceptance of the proof of export had been issued by the concerned excise authorities would not entitle it to the benefit of Rule 19.
The present determination had been based on the materials laid before - As the show cause notice(s) would demonstrate, it was open for the assesse to produce relevant records, documents and other evidence to substantiate its plea of export of goods manufactured by it, making those worthy of the exemption from payment of central excise duty as envisioned by Rule 19 of the Rules - it was worth-mentioning that the observations made and the conclusions reached were in the context of the debate addressed in the petitions and it would be open for the petitioner to participate in the proceedings arising out of the show cause notice(s) in spite of this adjudication - In such an eventuality, needless to say, the Department would take an appropriate decision in accordance with law in the said proceedings without being influenced by the above observation after affording due opportunity of participation to the assesse - Stay application Also rejected.
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2013 (8) TMI 611
Recovery of duty - circular dated 1.1.2013 - Revisional Power – Interim Relief - Held that:- Circular was incomplete in the sense that unless there was complete mechanism for hearing the stay petitions before period of 30 days, how the Circular can be given effect to which will tantamount to denial of the legal right to the assesses for, obtaining stay because of the fault in the machinery and mechanism for consideration of the appeals and the stay petitions resulting into attachment of bank accounts etc. of running business concerns, affecting it to the extent of financial crisis.
The order will be effective till the petitioners applications for interim relief - court directed the Ministry of Finance, Department of Revenue, New Delhi to clear its stand with respect to improvement of system of hearing of the appeals/stay petitions by the appellate authority or the Tribunal within a reasonable time, in the light of the Circular dated 1-1-2013 for consideration of the prayer for interim relief before 30 days from the filing of the appeal.
The mechanism for deciding the cases of the Revenue require priority in the interest of the nation and since we are coming across several matters where the prayer is only for interim relief in the writ jurisdiction, when the original appeal is pending before the appellate authority or before the Tribunal, and virtually making the High Courts the courts of hearing the application for interim relief when the main matter will be decided by the appellate authority or the Tribunal, the High Courts in the entire India appear to have heavily been burdened because of the lack of infrastructure in appellate or Tribunal level.
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2013 (8) TMI 610
Evasion of Duty - Revenue was of the view that the assesse manufactured and supplied the components/parts of Railway wagon without payment of duty to different units of Indian Railways showing the said goods as trading items in their books of accounts and thereby indulged in evading the Central Excise duty involved thereon - Held that:- The applicant company could not make out a prima facie case in their favor - The Adjudicating authority had discussed in details the evidences to hold the Assesse as manufacturer - wherever the claim of procurement of goods from traders and job workers had been made by the Assesse a fact contrary to the tenders/purchase orders, it was their duty to satisfy by adducing sufficient evidences before the Authorities in support of their claims.
They did not discharge any duty before clearing the said goods to Railways - all tenders/purchase orders of different units of Railways have been accepted and executed by the assesse company representing themselves as manufacturer - before the goods were finally cleared to Railways, the assesse company used to inscribe ‘AEW’ which is their trade name along with manufacturing date - the necessary testing which is the pre-requisite for supply of the goods to Railway was done at the factory premises of the assesse - the job workers admitted that goods supplied to the assesse were in semi-finished goods and the same were processed and inspected for quality control at the premises of the assesse.
Waiver of Pre-deposit and Penalty - Assesse failed to make out a prima- facie case for total waiver of pre-deposit of duty and penalty – the principles of law governing the exercise of discretion in disposing of the applications filed under Section 35(F) and also the interest of Revenue in line and the justice - 70 Lakhs were ordered to be submitted as pre-deposit – upon such submission rest of the deposit to be stayed till the disposal – stay granted.
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2013 (8) TMI 609
CENVAT credit - cenvat credit was denied on the basis of enquiry conducted with the transporters - Held that:- Prima-facie the ground for denying the cenvat credit was doubtful - the denial of cenvat credit was on the basis that on the date of supply as mentioned in the invoices - the transport of the goods covered by the invoices was not mentioned in the diaries maintained by the drivers - The ground for denial of cenvat credit also appeared to be without any basis when on this point, no inquiry had been made with the driver and the vehicle owners confirm having transported the goods covered under the invoices - The major demand is on the basis that the weight of the goods mentioned in the impugned invoices is much more than the weight which the vehicles can legally carrying and hence the goods covered under these invoices have not been transported.
Stay Application - The amount already deposited by the appellant was sufficient for hearing the appeal - the requirement of pre-deposit of balance amount of cenvat credit demand, interest thereon and penalty was waived for hearing of his appeal and recovery and was stayed - Stay granted.
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2013 (8) TMI 608
Demand of CENVAT credit – Bogus invoices - Interest and Penalty u/s 11AC - Held that:- Prima-facie the evidence in support of both the grounds for alleging that there was no supply of goods by the registered dealers was doubtful - the vehicle of the transport company were not involved - in the present group of appeals there were two transporters, the owners of vehicles had stated that they had not transported the goods - in view of the findings of the Commissioner (Appeals) it appeared that assesse may issued bogus invoices showing transportation of the goods in the vehicle - the department’s case was that notwithstanding the truck owners statement confirming transport of the goods, their claim cannot be accepted as the quantity mentioned in the invoices was much more the load which the vehicle can legally carry.
Stay Application - Prima-facie the assesse cannot make out the case for total waiver – 1.5lakhs were ordered to be submitted as pre-deposit – upon such submission rest of the duty to be stayed till the disposal of the case - Stay granted.
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2013 (8) TMI 607
Compounded levy - Production capacity based duty - Chewing tobacco and Filter Khaini - Notified Goods as per Notification No. 10/2010 - The assesse was engaged in the manufacture of Chewing tobacco and Filter Khaini falling under tariff item No.24039910 of the First Schedule of the Central Excise Tariff Act, 1985 - Whether the Filter Khaini Pouches manufactured by the Respondents with the help of packing machines were required to be considered as notified goods in terms of notification No.10/2010-CE(NT) and whether the same were required to be taken into consideration while determining the annual capacity of production and collection of duty.
Held that:- The packing machine used for packing of filter khaini pouches/pillows/sachets cannot be considered to be notified item and the goods manufactured with the aid of packing machine would not be covered under the compounded levy Rules - They were required to discharge duty not in terms under the said Rule, but in terms of the normal provisions of law - in the pillow packing machine for the manufacture of the said sachets would not be taken into consideration for determining the annual capacity of production and collection of duty - Section 3 A covers only pouches packed with the aid of packing machine and not the pouches that were packed manually - Inasmuch as the plastic pouches were pre-sealed and zipped from one side and the sachets were put in manually and the pouch was sealed with the help of hot iron/band sealer.
The filter khaini, pillows/sachets packed with the aid of packing machine do not bear any brand name, MRP, warnings as to health hazards and manufacturer's particulars, as required under the capacity Rules, it cannot be held that the same were notified goods in terms of the compounded levy rules - The same were more or less like the Tea bags, which were without any brand, name or carrying any other requisite information and which were ultimately packed in the final containers carrying various requisite information.
It was only the final container, which can be held to be as the final product -The Tea bags cannot be held to be the product which was marketable in that condition inasmuch as not even the manufacturer's name was described - even if the Tea packs were manufactured with the aid of power, they cannot be considered to be notified goods in terms of the Capacity Determination Rule.
The packing machine used for packing of filter khaini pouches/pillows/sachets can not be considered to be notified item and the goods manufactured with the aid of packing machine would not be covered under the compounded levy Rules. They are required to discharge duty not in terms under the said Rule, but in terms of the normal provisions of law. – Decided against Revenue.
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